at 8:00 a.m., steven sloan of politico exams key tax credits aimed at families and businesses that would be enacted. "washington journal" is next. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] host: the supreme court will consider if it will take up seven of the cases they have on gay marriage. and former president bush is recovering from baron kithes and expected to be released from the hospital on saturday. and lot of the front pages taken up by republicans. and secretary tim geithner on what they are offering. among the proposal, $1.6 trillion in new taxes and $4

billion in entitlement cuts and for our first half-hour this morning, what do you think of the proposal from the white house? what do you expect might be the reaction from congress? with those two thoughts in mind, give us a call. (202)585-3880 for democrats. (202)585-3881 for republicans. (202) 628-0205 for independents. we have posted this on facebook if you want to respond at facebook.com/c-span or you can email us at journal@c-span.org. highlighted in the pages of "usa today" this morning house speaker john boehner, the headlines, some of the details of what the white house offered. a little rundown.

host: again, that's just some of the highlight from the what the white house offered from tim geithner. we'll show you that during the course of our time together. but again, we want your reaction, not just to the proposal itself but what you think congress should do about it. so if you want to give us a call, (202)585-3880 for democrats. (202)585-3881 for republicans and (202) 628-0205 for independents.

"the washington post" this morning also profiles the man who delivered the message. it was tim geithner. obama's unlikely negotiator, read the headlines. another wrote that mr. geithner plans to step down in january and the fact that he selected him shows how much the president has come to rely on him. >> the huffington post if you were to go to their website has this to add to their story

about the proposal itself from tim geithner saying the proposal wasn't new. that have it was presented earlier this month by the president at the white house. host: so again, to reiterate what the proposal is. and like i said, over the course of the next half-hour we'll show you highlights. but it called for $1.6 trillion in new revenues and an

extension of the social security tax, one-year deferral of sequest vacation and stimulus spending with at least $50 billion in the first year an increase in the debt limit that would change the law for congressional approval. we'll show you more but let's hear from you. duluth, minnesota. hello. caller: good morning. thanks for taking my call. my comment is about the fiscal cliff and social security, i don't really think that social security has really ever been a cause of the deficit. there's more funds coming in than there is funds being sent out in checks. and this whole security tax is a separate tax from the federal tax. and --

host: so this proposal includes the extension of the payroll tax cut. what do you think of that proposal? >> i think that's fine. i think extending the payroll tax is probably something we're going to have to look at doing. but when they start talking about using social security money, that botters me, because social security is never needed -- has never needed federal dollars before to fund the program. host: ok. off of twitter this is reding who says they have not offered a deficit reduction plan. republican big pledges tax reform and closing unspecified tax loopholes. arthur, good morning. go ahead. what do you think about the proposedal? caller: i think the proposal is

kind of ludacris. but i really think that the republicans should back away. they should take their people, stand back and let the democrats have their way and let them do what they want to do and when everything melts down in four years, the republicans will be back in power. host: you said it was ludicrous. what exactly is it about the plan that you find lose cyst, in your stpwhords >> well raising taxes on the wealthy is not sensible at all. i'm 63 years old. i've seen it done over and over and over again. i lived through regan. i lived through watching jimmy carter bring this country down to the ground. and that's exactly what the democrats are going to do if they follow 4 throw with all these proposals that they want to do. that's why i'm saying, let the

democrats have their way, back away from the table and sit back and let them do what they want to do and we'll see what happens. host: this is john boehner from yesterday talking about the white house and congressional leadership. here's what he had to say. >> the president has warned us of the dangers of going over the fiscal cliff, but his actions have not masked his public statements. members of his own party seem quite comfortable in sending the economy over the fiscal cliff. two weeks ago we had a very productive conversation at the white house. but based on where we stand today i would say two things. first, despite the claims that the president supports a balanced approach, the democrats have yet to get serious about real spending cuts. and secondly, no substantive

progress has been made in talks between the white house and the house over the last two weeks. listen, this is not a game. jobs are on the line. the american economy is on the line. and this is a moment for adult leadership. host: up next on the proposal that was offered by the white house on the fiscal cliff. this is jon. independent line. hello. caller: hello. first of all, happy holidays. not sure. happy holidays, anyway. second of all, you people are journalists. you people are true journalists. i watch every day of the week. and one more thing, that fool that called yesterday, must be a product of inbreeding the way -- i don't know how they let him in. host: before we go back to yesterday, what do you think of the proposal today? >> caller: well, you don't know what they do behind closed

doors. what they put out to the public is one thing and from both parties. they both have a little spin here and there. politicians to me, ha, i could tell you a story that happened when i was a kid in the 1950's. i'm originally from new york and some woman asked a politics who was running, why should i vote for you? and he said outright, because time biggest crook in this neighborhood and that guy was always voted in all the time because he was honest. we don't know what goes on behind closed doors. people are getting all worked up about this. they let their emotions get the best of them. host: so you're saying you're not worried about what might happen or you're thinking something might change before the end of the year? caller: something might change before. host: kansas city, mizuho -- missouri secure they? hello. caller: yes.

that was just an election, and this was the best -- and the president won. so there. appear them to start now to put this roadblock shows that they are not serious. let the democrats come back with legislation and let's see how the public votes. host: what do you think about the $1.6 trillion in new taxes. entitlement cuts but what do you think of those aspects of what the white house is offering? caller: republicans have been against every type of social

security, medicare, but all you have to know is that there is no way you can cut your -- way to a balanced budget. host: from maryland, republican line. hello. caller: i watch you every morning. they keep talking about entitlement. why don't we cut some of these entitle appellants to politicians? the state and the federal. it was just in the paper. the state workers are getting a 47 cost of living raise -- a 4% cost of living raise. what about their transportation is paid for, their insurance, their food. their hotels. they get six figures of pay, plus all they do is campaign. obama's in the air again,

campaigning in p.a. today. could you imagine what it cost us for him to constantly campaign since 2006? host: so far his proposal has entitlement cuts. $4 billion. what do you think of that as a proposal at least to talk about as the discussion goes forward? >> i say take some from them. host: but what do you think about the cuts to the entitlement programs themselves? >> some need to be cut, granted. because there's too many people setting back and doing nothing. they talk about medicare. i'm 68. i'm on medicare. i have no medical care. if you're overweight or on drugs, you get free transportation. they can cut that back. but i mean, as far as -- yes, there's some people that need help. host: rick.

ohio, independent line. caller: yes. when you start breaking this stuff down, first of all, you have to identify your problem. if you knew what was going on right now, i would say 90% of the problems can be directed to the state of texas. that's where the last five wars are started. that's where halliburton and brown and root is. that's your largest military base in the world. that's where all your nafta and all your illegal labor. host: i don't understand the connection to what we are talking about. caller: well, you're talking about the fiscal cliff. that could be sucked out. $1.5 trillion out of our economy a year for oil and war. that's texas and virginia. texas and virginia is your war. now you're talking about taxes. if voted -- go to delaware.

that's where all your tax shelters are and your credit card companies. a trillion dollars in credit card debt. now you go to the state of new york -- host: you're saying overall states are the problem? >> there's three states in this country that are responsible for 95%. you have the east coast jews. host: ok. wild and wonderful from twitter this morning, better the fiscal cliff than the one that could result from a compromise for compromise's sake. on the democrats line, hi. caller: thank you for taking my call. host: go ahead. caller: no problem. i just wanted to say that, you know, -- awful smart guy came

one some pretty good ideas. i live in right-wing -- i mean, this is very republican and conservative area, here. and just about everybody i know , the republicans want to see taxes raised on the very rich, and you've got a guy making $10 million a year paying lower taxes than his secretary. you know, paying lower taxes percentage-wise, that's crazy. we need to fix this. host: let's hear from -- we heard from speaker john boehner before. let's hear from the senate majority leader harry reid responding to what has been out there regarding the fiscal cliff talks. this is from yesterday. >> republicans know where we stand. we've said it and said it and

said it so many times. the president said the same thing. it's been at least two weeks since we met at the white house and we're still waiting for a serious offer from the republicans. really now is the time for the republicans to move past this happy talk about revenues, ill-defined of course, and put specifics on the table. the president made a proposal. we need a proposal from them. >> the proposal includes $1.6 trillion in new revenues. other proposals out. some deal with unspecified entitle cuts and some spending, there's a write-up in "usa today." we'll show you that during the course of this segment. but that's the proposal as far as it was delivered by the secretary. i suppose more reaction will

come today. but we're getting your thoughts on ways to prevent this from happening, you can alsoal reach out to us on twitter and facebook. here is front royal, virginia. ramona on our republican line. ramona, are you there? >> i am here. caller: thank you for let me me speak. i am for keeping the bush tax thing. for the majority of people. but for the upper 2%, let that go back to the old tax thing. but do not penalize people for making money, and producing things for the country and hiring people, which is where the upper income, that 2% usually do. but let's do keep the middle

class taxes intact. host: do you think that raising those taxes on the upper brackets won't be a penlization of their earnings or what they do? caller: i think maybe, but it might satisfy the stupid democrats who -- like the speaker that just spoke policies to him. not much. because of that, we would concede to that. if it just raises the taxes, but not to penalize them. just raise their taxes as it was prior to the bush holding of taxes. host: here's mike from ohio, independent line. caller: morning, pedro. host: morning. caller: the problem we're having right now is we still have a two-party system. the system is so corrupt there's no way a party can get in. can anybody say iceland?

iceland had the right idea. they went in, threw all the banksters in jail that were creating all this fraud and anybody hear about the libor rating out of london, england? what we're going through is nothing compared to what will hit us. because they have been able to keep it quiet is because they have goldman sachs and those. look at london. can anybody say goldman sachs? we need to wake up. if not, our corrupted leaders are not going to do anything. host: twitter john says more taxes. no cuts, soaring deficits. sounds about right. we hear next from fort lauderdale, florida. this is jeffrey on the democrats line. caller: yes. i'm calling concerning the fiscal cliff. i was wondering -- funding is

going to be cut off such as unemployment. i'd like to know where do it stand and what is it being done? host: an update this morning on the former president george h.w. bush this according to reports out of houston saying he was in the hospital thursday for treatment of a lingering cough. he is 88 years old and has been in and out of the hospital recently because of complications due to wrongitis. they say expect the president to be released on saturday. he has been under hospital care for nearly a week. this is the republican line. hello? steve? good morning. caller: yes. good morning.

pedro, off question and comment. one problem is -- completely out of control. and they continue to -- don't want to touch -- in this country. because the prices of the medical are too -- government -- i don't want to -- medicare, keep complaining about -- and because the hospital -- and they never contribute that much noun medicare. and they put all the money they could toward the working -- if you add them up, it's not that much money. host: to the proposal at hand, what are your comments or

thoughts about it? caller: i think it should be cut a lot more than what they cut, because environment is what is killing this country and upping medical costs. they should get the sobel security. but i thought that's what the problem is and -- the congress and legislator to stop to fay medical. host: we'll leave it there. you may have seen this picture, it's the president of the united states in the oval office with his foreman opponent, mitt romney. according to some it was a private launch the featured turkey chili and the actual conversation that never happened while two presidential nominees are come paining against each other, they pledge

to keep in touch and maybe even work together all that according to what happened behind closed doors, the two men themselves never faced reporters. as you look that the picture, we will go to the independent line. caller: hello. hi, i'd like to know what happened to the cuts to the military spending. we're hearing about these entitlement cuts but whabbed what about the medical taxpayer cuts? when are we actually going to see returns from that? and what about the savings we were supposed to get they called it affordable care act not obama, where are the savings? all we're seeing is more taxes, but i'm not seeing where are the doubts our big-budget items like the military. host: all that was mentioned as far as the $4 billion and

entitlements. >> but where is the military cuts? host: what do you think about what is put out on the table? caller: well, i think that the revenues that they are talking about, the top 2%, they are not really going to, like people say it only covers eight days of the budget, they are symbolic. i think the real things would have to be cuts to the programs i don't think republicans want to give up. the military is a jobs program as they see it. host: calvin. up next, democrats line. caller: hello. how are you doing? host: fine, thank you. caller: i want to comment on the deal that was made yesterday. i think the republicans should

go ahead and take that deal, because you got to realize, this the top 2% are saving up their money and have been for 30 years. they have not been taxed enough for 30 years. can you imagine how much money the top 2% have right now? and them republicans, just trying to save their money. i mean, that's the bottom line that -- what i think is if they don't let the democrats let their budget go, we should go ahead and we will be going off the fiscal cliff. thank you. host: fort lauderdale, florida. republican line, pete. caller: hello? i actually believe all these numbers that we're showing up here on tv are just smoke and mirrors.

basically the important part was the last one where he doesn't need congressional approval to change anything. this, the government is basically set up to govern themselves, each step of the way to make the rules. he doesn't want that to happen. he wants to make the rules himself, this is not that type of place. just looking, everybody is concerned about the $1.6 in taxes, blah, blah, blah. that's nothing. the last part is the important part, because now he can have complete control over everything and anything. host: before you keep going on to highlight for the viewers at home maybe did not see this. part included the changing of the current la that specifically goes to requiring congressional approval. go ahead feignedish your point, caller. caller: like i said, the last part is the important part. the last part, he is going to

twist it. like everything else he has been doing, trying to go through little back doors slipping this and that in, that would change the current law requiring congressional approval? it just doesn't make sense. host: here's the photo from the u.n. yesterday. the headline is the u.s. heightens the state of palestine, this is mahmoud abbas congratulated by turkey's foreign minister as this took place as 130 countries agreed to upgrade palestine to trying to palestine and going on in the story of break downs, 138 countries in favor, nine opposed, 41 abstaining so the president is backing for the palace at a difficult time

host: one more call. ron, this is evansville, indiana on our independent line. caller: how are you doing? host: fine, thank you. caller: well, i tell you, a lot of people just ain't getting what's going on here. the republicans are trying to defund the government to the point where they can get rid of the social programs they cannot stand. they can't come in and just willy nily say they are over but they can defund the government and legitimately say we can e we can't afford them. they divided the country in half and turned part of the country against the other part thinking it's all their fault. well, it's not. it's been a plan by the republicans to defund the government so they can get rid of these social programs they don't like.

the job craterors. where are they at? 10 years of bush tax cuts and lower jobs. they are not creating the jobs. 30% of the g.d.p. in this country comes from banking. they don't have 1,500 employees working on a manufacturing line. they have that money market guy that made $5 billion in one year and cut a deal with the irs to pay 10% in taxes? i mean, you're not going to solve anything, because these people are in control. host: we'll have to leave it there. the president will be appearing at noon to talk about his proposal and we will be carrying that live. you can see that on c-span three and c-span radio as well. always invite you to go to our website. this will be montgomery, pennsylvania making a speech live at noon.

coming up on the program, we are going to have a discussion on the senate changes to the filibust err rule. if you follow procedural matters, you know what this is. norman ornstein will tell us more about how it's being proposed and more on the fiscal cliff, specifically atx pyring tax credits that will affect families and businesses. to get you set up for our next segment on the filibuster rule, these are proposals that will take place in the next congress. minority leader mitch mcconnell debated this. here's a bit of that debate. >> mr. president, we believe that there should be one aspect of the change that is that it should be a non-debatable motion of proceeding. simple as that. the american people -- only

ones who disagree that think this senate is working well are the republican leader and those republicans in congress. >> to the republican lead center >> yes. i hope the majority leader will stay on the floor here. i gather the way he proposes to affect this rule change is to deal with the simple majority. you didn't address that issue. >> but of course. >> well, -- >> that statement is untrue, and i don't accept that. >> mr. president, i believe i have the floor. that's the point. what the majority leader is saying he will break the rules of the senate in order to change the rules of the senate. it had been the case in the past that it took a super majority of 67, which of course meant that most rule changes occurred because two leaders agreed to them and were proposing them jointly.

instead, what the majority leader is saying is he will propose to change the rules with 51 votes meaning his side gets to decide what the rules are. and the danger of that is of course let's assume, i know the majority leader must think he will be the majority leader forever, but what if he isn't? and what if it's two years from now and my members say if 51 democrats change the rules why can't 51 republicans? why should we have to fiddle with these people in the minority? why not just change the rules of the senate and turn the senate into the house? >> "washington journal" continues. host: and joining us now to make sense of some of the changes you heard is norman ornstein from american enterprise institute longtime follower of congress. why is this such a heated issue? >> well, it's been an issue for more than 100 years.

but in the last few years there's been increasing tension between the two parties over the way the filibuster has been used. if you look sivens 2007, there's been a dramatic increase and it's filibusters being used not the way they were 20-100 years ago which is very rarely for issues of great significance but it's now for bills ultimately passing unanimously. so democrats who have been in the majority now for six years have gotten increasingly frustrated over this, frustrated when they have all the reigns of power, the house frustrated even when the house was in the hands of the republicans and there's been pressure building to do something to redo the rule. in 1975 we did it and we have clearly reached a flash point now. host: could you explain exactly

what is it and how does it work? >> just to give you a caps assume history, pedro, there was no filibuster at the beginning of the republic. what happened is, in 1805, the predeciding officer of the senate, the vice president said as he was leaving office said, your rule book which includes as it turns out something that enabled you to stop the debate and move to a vote on the previous question, he said you've ought to clean up the rule book and inadvertently took the rule out and then you had no way to stop debate. but any senate can deny unanimous consent which means that's how it operates to move forward then takes to stop the debate from moving forward and that the point 3/5 of the

senators or 60 votes if they have the full 100. but you could use it to stop or continue to debate and block action on the motion to proceed to a bill. then if you agree to proceed to a bill, you move forward on the debate for the bill itself and filibuster that, requiring a bar of 60 votes, if you finally work a compromise with the house and off conference report coming back, you can filibuster that. each one takes many, many days to overcome. you can't just say ok, we've got 50 votes. let's move forward. you've got file are motion for what is called cloture your. it has to ripen for two days. then you can have a significant amount of debate before you get to a vote. after you've voted for slow chure, so you're going to stop debate. now there's 30 hours of post

cloture your debate. so if you want to use the filibuster, you can stop everything for six or seven days and democrats believe republicans have done this repeatedly to use a phrase the normer senator bob bennett said was mitch mcconnell's idea was to throw sand in the works. and that's what's bringing us to this point of changing things. host: here's your chance to learn about the procedure and change with our guest. if you want to call, (202)585-3880 for democrats. (202)585-3881 for republicans. (202) 628-0205 for independents. twitter.com/cspanwj is our tweet. and you can email us at journal@c-span.org. so what is senator reid proposing? >> before i get to that, pedro, let me just make one point. this issue is a little bit like your debt ceiling one.

your perception depends on where you sit. so it was before republicans in the majority with their own president frustrated and talking about how they were going to change the filibuster to enable it to act. now it's flipped around. it's your president and they are saying let's be responsible. so we have had this tension develop, but it's younger senators who push this now and harry reid who resisted for a long time, because he knew he would be back in the minority, he has embraced them now out of his own frustration. so they no longer want a filibuster to stop a motion. and the other is the so-called talking filibuster. now you can lift your little finger as one senator and say

i'm going to filibuster, and you've still got to go through all of these motions. you don't even have to appear in the senate at all until there are votes. so they say let's go to the mr. smith goes washington days, if you're going to filibuster, you've got to be on the floor talking. as soon as nobody's ready to talk, it goes to a vote. and if it goes around the clock the minority will have to be on the floor and show some dramatization. host: get in the game so to speak if they really want something done? guest: yes. and the last time the filibuster rule was changed was 1975, 2/3 of those present and voting. they moved it to 3/5 of the entire senate. if you think of going around the clock, if you're in the minority, you've got to be around. let's say that you decide to go home and sleep and the majority

has 51 senators there to make a quorum and they say we're going to hold a cloture your vote, if it's 2/3 there present and voting, they only need about 35 senators but if it's 3/5 of the senate, the majority has to have that many people around there. so now they want to urn it around to where the pain is on the minority not the majority. host: steve, you are up on the democrats line. caller: thank you for taking my call. i absolutely agree with norman ornstein. i think that the filibuster's been massively abused since at least 2000. and it's childish on city nance, this do anything to stop mr. blacky black man is old, and i think the american people are tired of it. guest: let me note one thing that one of the hesitations

that some democrats have now is the house is in the hands of the republicans, so if your goal here so get legislation through, they are not going to eliminate the filibuster, they are just going to put the pressure on the republicans. this may help you get bills through the senate but it isn't going to homestretch you in the house. and if they do it by the way they wanted called the nuclear option instead of doing it normal practice, that can be filibustered and requires 2/3 of those present voting. if you do it that way, the republicans have indicated that will go to defcon one and block all action in the senate and that it's unprecedented and won't happen. so you've got to be careful about what the cost and benefits are. that's part of the debate going on, but as the caller said, there's a lot of frustration

throughout because of the belief that this is a misuse. guest: democrats added two seats, which was pretty stunning but added members that are feisty, those like elizabeth warren who have made filibustering a big issue because elizabeth warren was really blocked from being able to take over position at the head of the consumer financial bureau because of holds and filibusters. holds is basically a formal notification by an individual senator that he or she will deny unanimous con seant filibuster which is usually a death blow to a nominee unless it's lifted. caller: pedro, i hope you give me a few minutes like you've given a lot of other people.

norman ornstein, instead of filibusters, they should have to stand on the floor and make their point and argue their point. but the president ran a class warfare. i think the republicans should give him class warfare right back. host: if you have another question about what we're talking about, but we're going to have to move on. caller: independent line on every state on welfare. host: jack on our independent line. caller: i thought we were still on the white house budget proposal, but we're talking about filibuster rules. in my opinion i think the filibuster itself, not only has it been abused. but i think it's an internal power struggle and made up by all those guys and women. to me, it seems like it's a power struggle. if the democrats feel like they have power in the senate but not the house, they want to change the rules and if it were the other way around,

republicans would do the same. the american public should really recognize the political framework around this and why they are actually doing that. but my comment about the budge set social security, medicaid. host: i'm sorry to, i want to keep it to this topic. to the minority parties, point, if i understand it correctly. the difference between this process, could you explain that? guest: you could view it as a chicken and egg prospect but the majority leader has a lot of power in the senate to fame debate. so what a majority leader can do is a process known as filling the amendment treatment basically through his power of recognition, he can put in a number of amendments to every degree and block any other amendments from moving forward. majority leaders from both parties have used this to varying degrees and used it

more and more and frankly used because you want to get away from too many filibusters, but also because leader doesn't want amendments that could be damaging to his members, so the republicans have a legitimate right here that they want to have vehicles to protest when they are not allowed amendments. one of the proposals that has been out and formalized by one of the most senior and respected members of the senate is basically a tradeoff. we will end filibusters on the motion to proceed and give you a guarantee of timely and relevant amendments. and this is also something that's been discussed frequently in the hearings and the rules committee in the senate. i've testified a number of times, by chairman chuck schumer and ranking member. there are seeds for a compromise here that could

work. the last time the filibuster rule was changed in 1995, it started with a shock wave. shpt rockefeller -- nobody knew it was coming. the senate is not a continuing body despite 2/3 of its members are there at any time, and they said, time-out, and moved this bipartner compromise. you could see that happening again where there's this threat of doing it by a unilateral motion and that brings mcconnell and alexander and others to the table, and reid and his colleagues agree that they will be much more open with amendments in return for a change that would ration down the affirmative louse use of the filibuster. host: if the democrats wanted to do this, what's the timeframe? guest: the way it would usually

work is you do it right the first day, january3, as the house sets its new rules on that first day. but the original proposal for what's called the nuclear option, which republicans had thrown on the table some years ago over judicial nominations said that we'll do it at any time. not get too technical, but it's basically somebody said to the predeciding officer, we want to know what the parliamentary ruling is on whether you can end debate, in this case, with a simple majority. the parliamentarian would advise them that that's what the rules say is and no, you need a filibuster and appeal the ruling of the chair, and that can be done by majority. so there's a slippery way around it that you can do it at any time. harry reid will say to mitch mcconnell.

we'll check that out. i'll give you some amendments. if it isn't working at any time, we'll change it unilaterally. host: and this is sort of nung cheek, with the ousting of the filibuster rule, why do you need elections? >> well, it's not all clear that's what the framers had in mind or that it fits even a model of a parliamentary government where if you have all reigns of power, at least you can act. it's not the way things have worked in the past. and the other part of this is it's a kul problem as much as anything. the filibuster used to be a way to fix things. if you need 60, the minority has to reach out to the majority to reach some sort of conference mize. now it's being used as a weapon that drives some apart.

so for those of us who want it to work in the ways the framers had in mind, now it takes a rules change. host: the potential change in an op-ed, the those encapsulated -- what you're saying now is? guest: the talking filibuster that they are talking about has its limations. it can be very useful on one of these big bills like the affordable care act, but if you're using the filibuster on everything, the majority is not going to bring this place to a halt over hiring an assistant secretary for education. so my thoughts that i have had for some years. now it takes 60 senators to stop debate. the onus is on the majority. in the past they had to haul

92-year-old robert burns out of his hospital bed to come to the floor to provide that 60th vote. you want to continue to debate, you have to have 41 voters on the floor every time there's a motion to stop debate. that seems to me as a more effective way. because you could make it apply to all these over filibusters. host: a tweet says what happened to majority rules? the filibuster was to give everybody a say, not to rule the land. >> and a filibuster was a rarely-used phenomenon. up until the 1950's yoo might get one or two a year. now cloture chure motions, the one who stop debates aren't ones you talk about. host: democrats line, james, go ahead. caller: yes, good morning, c-span. thank you for taking my call.

i understand the filibuster rules. i'm 63 years old, and i'm a disabled veteran of 10 years, vietnam. but nobody wants to get down to the plain, cut through the chase on the filibuster. mitch mcconnell, god forbid, has stated from day one what his objective is. to stop this man. nobody wants to talk about it, because it's politically in correct to bring up the race issue, but it is so obvious. and i have european friends that i speak with in europe, and they say it's so obvious. it is pure racist. host: comment? guest: you know, race is never far from the surface in american life or american politics.

the use of the filibuster in this way, though, preceded barack obama's presidency. if you go back to 2007 and 2008 when george w. bush was president, democrats had the majority in the senate, they used filibusters to block bills from that might be an embarrassment to the president. but the caller, whether it's race or not, it's pretty clear that senator mcconnell has used weapons to try and block actions taken by the president that have not been used before in this fashion, and use them in unprecedented numbers. host: and according to history, civil rights was one of those things the filibuster got used for. >> what's interesting about those is while it wasn't a partisan issue, it was a

factual issue. dirksen was a great hero of the civil rights revolution right alongside his partner, lyndon johnson. it was the southern democrats, but at the -- that point in time, it was the southern democrats that wanted to talk and one held a record of talking for 24 hours straight. these are filibusters where they don't want to take the floor and they have no interest in debating. it's all to block things. when you get a filibuster when you have bills that pass unanimously, it becomes clear that this was not a matter of principle over a particular bill but a tool of obstruction. host: randy in minnesota, republican line, good morning. go ahead. caller: yes.

good morning, c-span. this filibuster thing, this is the perfect way for our government to work the way our government was set up to work with checks and balances. with the filibuster rule, -- i'm getting an awful lot of feedback. host: go ahead. caller: i don't want the void it i want to make these guys sit down and do the people's business. president obama wants to fall off the cliff. that's why he wants to go do that to the middle class and blame the republicans. host: caller, we'll leave it there. caller: be on the republican lines say, let them talk. guest: so it may be that this filibuster idea may have more support. democrats don't want to eliminate the filibuster. they want to keep it in place

but just want to change the burden and move it to where there's one bite at the apple on a particular bit. so these changes are not earth shaking. one is your perspective on it, whether you're in the majority or minority. but the way you do it becomes an important part of this. that's why the implications here are fairly clear which -- fairly clear. if we end up seeing this happen by call it the nuclear option or defined as the constitutional option that it's perfectly constitutional to change the rules by a majority. but that means on issues from the budget to immigration to many of the other priorities we have, a farm bill that's not yet gone through, we could see another twist in this that goes beyond a simple rules change. that makes the next two weeks of maneuvering and negotiating,

particularly important ones for all c-span viewers -- host: if i'm speaker john boehner -- guest: he's basically said if the democrats unilaterally change the filibuster rule, the house will unilaterally block any bill that passes as a rule. you wonder if they will continue to hold to that if it's something they really, really want to do. host: our next guest to talk about potential changes. go ahead. caller: good morning, pedro. thank you, norman ornstein for coming on the show. i like your point of view. i want to ask you, if you can project into the future what the rules of the senate would look like outside of the context of the present crisis.

guest: well, we're not talking about many significant changes, but there is an important thing to keep in mind. the way the senate has operated for a very long time is with a delicate balance which is with unanimous consent, every individual senator has an enormous amount of power, including the ability to block way beyond the filibuster, there's so many ways that you can botch up the system and keep things from moving forward. occasionally they have had these maverick individuals from the left and the right. strom thurman, jesse helms, that will use their individual power to gain leverage over parts of the senate. occasionally you will have it now as we do with a party operating that way. but the rules of the senate go way beyond the filibuster. and where the republicans now have some leverage in this is if they want to really mess the

place up by denying unanimous consent on everything and forcing all kinds of torturous ways around that by saying that the senate, if it's in session, they won't allow committees to meet. by requiring the reading of the journal and amendments at great linux, that those are all things by which if you wanted to move past them, you would have to completely overhaul the senate rules and make it like the house with the trains running on time, and the fear of senators from both spearts, you push this too far and you lose the character of the senate which is a body of individuals representing states but not quite the same as the house of representatives. and that's where changes in rule 22 as it were, the filibuster rule, matter, but you've still got a lot of other rules that give tremendous

power to individuals and the power of the party as it unites together as a minority to block action is still very, very considerable. host: if someone decides to stand up there and just take up time, could they open up a book and read it? guest: they could. with the talking filibuster, you have to talk about something that at least is relevant. but defining really inventories is a tricky business. host: one more call from berkeley california, democrats line. caller: hi there, mr. ornstein, guest: hi. caller: i have to two questions. first off, i want to congratulate you for demonstrating integrity, because i believe you're representing a highly conservative institution with american enterprise and your views are coming across unbiased. guest: thank you. caller: secondly, i am not scared of the nuclear option.

initially based on my limited experience or knowledge about it, and/or the stopping of the senate. i had an think it might be a portal we might have to pass through as a country to get beyond it. is it unprecedented that somebody, a majority leader would take that option, and what else in terms of the nuclear option could be used for if it became something that was standard fare? do they have to stand on the floor and talk during a filibuster? i seem to recall that i have seen that happen in my lifetime. guest: we have never used the so-called nuclear option.

the senate has come close several times. that it ise the idea a continuing body and a unique body. what we see in the debate and the rules have been reversed since it was mitch mcconnell threatening to do this if you years ago. in future majorities will take much more extreme actions including eliminating the filibuster entirely. we will swing wildly back and forth. the house of representatives has always allowed a majority to set rules. you do not get wild swings back and forth because everybody knows you better keep some limits or the next guy may do something more intern. it is a fear that exists.

you could make a tweak in the roll and get frustrated because you want to get your program through and keep changing the rules with the majority. it would be interesting by dangers to see what would happen if they do open up this avenue. there's a good chance that if they do, we would have a brief period of intense opposition by the minority. but they will not block an immigration bill when it is in their own interests to pass it, or to block action on the fiscal cliff if the markets are going ballistic. it would settle down after a while. host: what is the likelihood we will see changes? guest: they will not

necessarily occur at the beginning of congress. there is a good chance that they will step back and do a compromise that involved both parties. host: norman ornstein, thank you for your time. we'll take a closer look at expiring tax credits for families and business with steven sloan of politico. we'll have that right after this. [video clip] >> a program began under rexford tugwell, who was one of the advisers to president franklin roosevelt, to document the conditions under which people were living. this was back when we didn't

have television. we had radio, but a lot of places didn't have electricity, so they couldn't listen to the radio broadcast to find out what was going on other in parts of the country. roy stryker, who was an economist from columbia university, he was the head of this project, and in 1939 when kodak introduced color film, they sent film to roy stryker to have his photographers try out, to see what they could do. kodak was trying to establish a new market, a new product and they wanted people who would know how to use it effectively to try it out and publicize it. >> america of the 1930's and 1940's comes to life through the eye of the camera as the library of congress curator beverly brennan shares some of the 1,600 color photographs taken during the depression and world war ii. "american artifacts," sunday at 7:00 p.m. and 10:00 p.m. eastern. part of american history tv this weekend on c-span 33.

>> we had 2000 flight officers or generals. today we have 1000 flag officers and generals. the ratio is totally out of whack. wheels have an animal for every ship in the navy -- we almost have an admiral for every ship in the navy. we could transform responsibilities out of the pentagon and consolidate programs and save a significant amount of money. >> you can talk with tom coburn about the fiscal cliff and the future of the republican party on "in depth."

the senator has written several books and reports. join us for senator tom coburn, live sunday at noon eastern on c-span2. "washington journal" continues. host: we are looking at various aspects at the so-called fiscal cliff. joining us for the discussion is steven sloan. he is with politico. could you define what a tax credit is and how that differs from a tax deduction? guest: credits and deductions are used to lower somebody's tax bill. if you have it $1,000 tax bill,

-- basically a reduces taxable income, so it takes the taxable income off the top. if you have a $1,000 tax deduction, that is basically a to under $50 deduction -- $250 deduction. host: on their tax credits that specifically affect families? guest: some that have expired that are part of the fiscal cliff package. they get much less attention than the bush tax cuts. they are part of the packet of decisions that congress has to make. host: we can go into debt but to highlight four --th

let's start with the child tax credit. what is it? guest: this is a credit that applies to families, some that you can use if you make up to ,000.0 it is they $1,000 credit for each child. unless congress acts, that 10000 becomedit will $500, but becomes less valuable. you can make up to $130,000. host: that is the child tax credits. guest: almost 24 million

families claimed it in 2009. it is one of the bigger tax credits out there. host: the next one would be the child and dependent care tax credit. guest: is a credit between 20% and a 30% and goes up to $3,000. it helps families with their expenses for child care or if they have dependents and things like that. you can basically claim a credit of $3,000. host: for child care purposes? guest: this helps with dependents. host: the earned income tax credit is what? guest: it is a credit whose

primary recipients are working parents with children. this is something that is designed to help the low-income families help them have lower tax bills and get money back from the government at the end of the year. host: the phaseout begins at $5,000. to elaborate on what that means? guest: it is something that is aimed at the lower income people scale. that is what we're looking at. host: the final one deals with education. guest: this can about during the stimulus. this is a tax credit for education expenses. it expires at the end of the year unless congress extends it. host: when do these impacts take

place if nothing is done in december? guest: most of these end at the end of 2012. this would affect people in january. host: what is the benefit for the treasury department? guest: the treasury would get more money. that is money that is no longer coming into the treasury. it is real money. the child tax credit claims in 2009 totaled about $20 million. you can get a sense of how much on the treasury would have gone if that credit were not in place. host: is there a sense of what this has cost the treasury? guest: several hundred billion dollars.

host: is a large part or is this a side issue as other things get debated? guest: most of the discussion is what happens to the top two tax rates. that's where most of the political attention is right now. these are important issues for families. they haven't quite gotten the attention yet. host: lower income, middle income, that is where we're talking. guest: this is the heart of tax policy for low and middle-income families. this is if you're making tax policy at those families. host: steven sloan is our guest as we talk about tax credits. if you want to join us and ask

questions about the specific credits, here is a chance to do so. here are the numbers. 202-585-3880 for democrats. 202-585-3881 for republicans. 202-585-3882 four independents. journal@c-span.org is our e- mail. what is the sense of congress? guest: nobody wants to take away tax incentives for lower or middle-income americans. these are things that cost money. the tax code isn't the place to help families raise children. there are spending programs and things like that. there has been a lot of debate over this yet. you could see some more.

host: steven sloan is our guest and he is with politico, senior tax reporter. our focus is looking at tax credits. first call from oklahoma, daniel. caller: i just had a question. if they are allowed to let this go over this fiscal cliff, are we going to not have these tax credits for the upcoming taxes we are filing for this year? and also, will congress be able to take their vacations this year even if they do not do their jobs? guest: these are mostly things that will affect the next year. most of these tax credits were in place for 2012.

it affects your 2013 tax bill which you pay in 2014. the congressional schedule is very much up in the air. everyone is figuring out when they can go home. there is nothing official yet. you could be here very much their christmas eve. host: ann from florida, good morning. caller: good morning. i like to ask steven sloan. he is an incredible cas guest. i'm in my 50's in florida. i take care of my grandson. youri'm asking you is generation will not have to be on top of these issues. i appreciate all that you do.

if you were at my age and you refinanced your home and had moneyredit, and all that that goes for paying into the refinance of your home, is that still a deduction as the east today if you refinanced your home? i'm talking the primary home. host: are you affected by the tax credits we're talking about today? caller: i am disabled and i had issues.subone my husband does take one deduction and i take care of my grandchild. my children are married and stable. host: thank you for the

question. guest: the mortgage interest deduction is still available to you. it has not gone away. the mortgage insurance deduction is a logger in place. you can still claim the more gage just deduction. host: does it have to be from a recognized day care provider? guest: there are some rules but i think they're pretty flexible the irs has on its website. host: roy is next from indiana on the independent line. caller: he has entered some of the questions. you're talking about the mortgage exemption, the money you pay on your mortgage.

i have never been able to claim that and i'm 78 years old. i understand the republicans want to do away with that. is that correct? guest: i think no one wants to get rid of the entire mortgage deduction right now. we're hearing talk about whether you would cap the overall amount of the deduction that somebody could claim. this is an idea mitt romney had on the campaign, this idea that you cap the value at $30,000, say. if you live in an area with low housing prices, that probably would not affect you. if you live at new york, san francisco where your mortgage is more expensive, it would be easier to bump up against what the deduction cap would be.

you might not be itemizing your tax returns at the end of every year. host: next call is mike on the democrat's line. areyo you there? caller: i have a question for you. i heard president obama is making cuts to medicare if his plan goes through. he wants to cut $400 billion in entitlements. i collect ssdi. i am disabled. these $40 billion cuts in entitlements, are they going to affect ssi, ssdi?

guest: we do not know what the administration is talking about yet. that offer came from the administration on the hill yesterday. it was not specific. $400 billion is what we are looking at in entitlement savings and we're not sure if it is ssdi or how beneficiaries would be affected. host: children make up a lot of these credits. which of these are affected by the amount of children you have? guest: some of them do matter. the eitc, there was a law that allowed you to climate for more than three children.

that could go away by the end of the year. host: the earned income tax credit specifically. mary from kentucky on the republican line. caller: good morning. we are small business owners. with many of these taxes going up and there are proposals in kentucky to raise some of our state taxes because we have deficits and pension obligations. not only will we be hit with all of these federal issues but we will be hit with the state issues as well. and i think that we are getting close to breaking point with these additional obligations. i do not think that president

obama and the people who are advising him really have their finger on the polls of what it will mean for small business owners. that's what concerns me. people like us have been able to cope and still have been able to save and to send our children to college. that is close to going away and this is one of my great concerns. guest: 1 the untold parts of this story -- one of the until parts of the story and sometimes we overlook what is happening in the states. they're raising state and local taxes to solve their deficit problems. something to keep in mind when we talk about these detention caps.

you could be pushed up against a deduction if you live in new york. if you live in new york and have high state and local taxes, if congress moves forward with a deduction cap, you could go right up to that cap. host: 24% of those were claiming the earned income tax credits. 13% climb in the child tax credit. these credits, you can use them simultaneously. guest: some of these are refundable which means you get money back even if your tax bill is zero. whenever the refundable not is

-- whenever the refundable amount is, you get to take home. host: we will go to ray in atlanta, georgia. caller: how much will an individual or can an individual receives who has two children in a single-parent household? what is the maximum amount of money they receive back in the form of tax credits? once you look at that and if there at that dollar level, we're finding their children for free and reduced lunch and i assume adding some additional money for their housing. what is the maximum amount of money a person can receive? guest: i do not think there is

an easy number 2.2. so one can receive $50,000 on these credits when they combine them. there are other programs out there like free lunch at school that goal in combination with these tax programs to support low and middle-income families. host: the redder from cleveland, ohio -- loretta. caller: good morning. do you know how many corporations in america file for the republicans corporate tax cuts each year? why aren't they means tested? corporations with billions in profits should not get tax cuts. they have enough money to pay

their taxes. my second question is about the mortgage deduction. i think they should be only on the primary home. senator mccain has seven homes. i you telling me he is getting a deduction on all seven? that is class warfare. guest: the mortgage interest deduction is mostly focused on your primary home. you get phased out, if you will . the corporate tax code is not getting a lot of talk because everybody is focused with what happens with the top two brackets of the bush tax cuts. companies are lobbying congress to push down their tax rates by as much as 10 percentage points.

i don't think is going in the direction that the caller wants. host: a comment from twitter. eric from fairfax, virginia, is next. caller: i'm confused by congress is not willing to look at the root cause of the troubles that we are having. the fiscal cliff -- this reserve system that our monetary policy drives us to use it, the notion of creating something from what we i think that's need to focus. the problem is not what taxes going up or down, nor does it have anything to do with what the government gives or does not give to the people.

congress is not thinking out of the box. i think it will be the status quo and i'm disappointed. guest: it is important to talk about fiscal policy and monetary policy. congress doesn't have that much control over what the federal reserve is doing. there has been anger about how the federal reserve has reacted to the recession and a lot has happened on capitol hill. congress' hands are somewhat tied. host: paul joins us on the independent line from florida. caller: good morning. i have a question concerning the home mortgage modification program. i'd like to know if you can

explain the relationship of this big fiscal suicide we are about to enter. it seems to me that there is an iou in the treasury for close to $4 billion due to the lock box since al gore brought it up. guest: democrats are pressing for some type of mortgage element to the fiscal cliff. the ministry should has offered money for housing refinance program. it will be important to see where that goes. host: the child tax credits. has did been supported by those in congress? --has it been supported by those in congress?

guest: is this what the tax code is here for? is it meant to help subsidize families that are trying to raise children? of focusing on the money you need to bring it to run the government. that is essential element with all of these tax programs. host: tax credits and how you might be affected if the fiscal cliff happens. steven sloan from politico is joining us. willie from chicago is next. good morning. caller: good morning. my question is -- hello? host: you'reon. caller: if a company is being paid by the government, a tax credit for a guy to work for a

company and the state turns around and paste the government to keep the company in a certain state, is that like the government paying for this guy to work for the company? guest: you have federal tax programs that incentivize companies to hire veterans are people that are disadvantaged or maybe people who live on food stamps. those companies can get state incentives to locate in a certain part of the state or to locate to another area and those programs often have interactions. host: gilbert is next. caller: i understand there is a lot of fussing about oil companies getting subsidy from the government. exxonmobil pace multi millions

of dollars in federal income tax every year. what exactly is this subsidy that the oil companies are getting? guest: there are a host of tax incentives for oil companies. these tax incentives basically allow them to pay less on their equipment and things like that. they do get a lot of attention. congress has tried mulled betimes to limit the tax benefits for the top five will companies. -- top five oil companies. it has not passed because of opposition. mary landrieu said she looked through this as part of a broader package.

the small businesses -- if you're organized as a partnership, they are not corporations. you claim your business income on your individual tax returns. if that business income kicks you over $250,000, you almost certainly will be subject to higher taxes in january. host: paul, good morning. caller: good morning. thank you for taking my call. i would like to know what these rates would go up to for the individual taxpayer if we do go off the fiscal cliff? guest: if we go off the cliff, the rate will go up to 39.6%.

the low bracket will go away and the lowest tax bracket will be 15% if we go off the cliff. 15% to 39.6% if the goal of the cliff. -- if we go off the cliff. caller: what about the other rates? host: we have a question on twitter. guest: you don't pay taxes on losses. if you're making profits and a picture up over to roger $50,000, that could result in a tax increase -- if you make a you overd that takes you ovkics

$250,000. caller: we need jobs in this country. i hear all this money being talked. the average worker -- i am lucky i get 30 hours. 20 hoursutting down to walmart.t i had a good manager. in.otice a woman comes the she says we can get anybody to work. you talk about the tax credits. most of us have no chance of getting anything like that.

this is too low republicans and democrats. fascism and communism, it was always party first. that's what our country has come to. we have to come together as true conservatives and true democrats and come together. guest: one of the big lessons we should take away -- we should look at whether these tax incentives result in hiring because these are often temporary tax incentives. is is going to push an employer over the edge to hire somebody? is this a deciding factor to make somebody hire somebody or would they have hired them regardless?

the government has essentially lost money. host: there are a lot of tax credits that expired in 2012 and some of them go by the work opportunity tax credit. activated military reservist. what is the scope in terms of tax credit for small businesses? guest: the scope of tax provisions that expire, it is massive. it is long list and hard to keep track of them. the work opportunity tax credit is one you mentioned and that was something that expired at the end of 2011 that is up for right now to see whether that is something that can be extended again. is something that is the tax

credit that applies to companies and gives companies a tax credit for hiring disadvantaged workers, people on food stamps. it is temporary tax policy. host: it rundown of tax credits that would affect you if the fiscal cliff happens is what we're talking about with steven sloan with politico. we have about 20 more minutes with our guest. 202-585-3880 for democrats. 202-585-3881 for republicans. ts.-585-3882 for independen you have a story and talk about this visit. what we're talking as far as what the white house is

offering? guest: they want an immediate increase for the top earners, the 35% rate going to 39.6%. about $960 billion in immediate revenue. the administration is seeking $1.6 trillion. the rest to come sometime next year as part of tax reform. host: this is the first time republicans are hearing from this from the white house? guest: you could argue the first time since the white house that a member from the administration is going to the hill. this is a senior administration

official that is coming to the hilt to present what the administration wants to do. host: what happens now? guest: republicans rejected this offer yesterday. it will be interesting to see whether we see some negotiations take place like what we saw during the debt ceiling talks during 2011. also if a start seeing message bills coming out both chambers. both chambers have done plenty of the message bills on this issue. we will be looking to see if the house passes a bill again. that would extend the rates for everybody and if the senate passes a bill just for the middle class. any of thato see if takes place and if we are moving towards a deal.

host: jay the republican line, go ahead. caller: thank you for taking my call. they should do away with all tax credits. are both part is the same -- they like to spend to keep in power. why don't they take a 20% deduction and do away with 20% of the government? there is also other taxes like gasoline tax, phone tax. we pay a lot of money to foreign countries that we do not need to. as i think about taxes. guest: this is kind of one of the ideas that republicans talk about, and democrats talk about when we talk about moving to tax reform.

it is getting the individual provisions. rainout it is a complicated mess -- right now it is a complicated mess. the kind of start over with a simple system that has a few income brackets. easier said than done. that is one of the goals here. host: jim from twitter says -- guest: absolutely. a lot of these credits and deductions, the standard deduction exceeds what you would get, that you just take that. host: the specific credits we have been talking about prompt a question from cindy. guest: yes. you generally have to be working

are working outside the home. host: is there an hour requirements? guest: there are a lot of specific requirements. host: kay from richmond, virginia. caller: if somebody is working as hard as they can and making less than $50,000 a year, they count on this refund every year as a savings account, maybe. instead of doing away with some of the benefits that people are getting for free, why are they getting money that equals or - what you're making per hour. you're getting a benefit taken away and they are still getting as much as they did. guest: this is a hard balance

for congress to strike. how much do you want to give people in credits and how that in directs with other welfare programs. there have been efforts to rein in those programs as the recession has tapered off. host: sonya on the democrat's line. caller: thank you for taking my call. it is my opinion that the situation we find ourselves in with the lack of revenues and our taxes is simply one of the flaws and the in sustainability of supply-side economics and trickle down economics. it will not work. let me explain myself. when you do the trickle-down and take the money straight up to

the wealthiest and expect them to come back down and trickle the money down through the system, it is not working. we have gone from wages of stagnation and jobs have been shifted elsewhere. if you started with a strong economic base where you had the money starting with the working class and then it would get taxed there at the state, local federal level. it would be spent. those people, the items they bought, it would be taxed again there and on up. and each time, it would be taxed. we would have the revenue for infrastructure and the

programs. i'll hang up and listen to your comments. guest: it will be interesting to see how this works out going forward. the role of tax policy in government was a big issue during the recent election, whether we should have tax policy that some people skews towards the wealthy or helps corporations more than individuals. that's a lot of what this election was about. it will be interesting to see if anything changes. host: "the san francisco chronicle" talks about the tax issues. does that fall into a category of things that might be considered?

guest: there is some many moving parts. host: family tax credits -- host: any sense that that is on the table? guest: there are so many moving parts to this. host: you did know that existed . guest: you can go to the joint committee on taxation's website. they have a full list of all of these credits and deductions and how much they cost over time. there is a good explanation of a

lot of these tax deductions and credits that are in play. you think of the cbo for spending. they are non-partisan body in congress that deals with economists that look at what congress wants to do something related to taxes, here is what it would cost and how much it would do. caller: hi. .'m 52 years old i just have a question, a general question. they are talking about the rich people. i'm not rich by self. the rich people not paying their

fair share. i do not see how that came about. it seems the poor are not paying their fair share. i paid to plus 5% last year because i got an education credit. the comment on how they can about that. guest: there has been frustration in the aftermath of the recession as to whether this rescission has been -- the recession has been devastating. there's been a frustration about whether tax policies have helped top earners and not doing as much for the middle class. we got cut off in the campaign % and whatout the 47ab

that meant. they are paying payroll taxes and things like that. just not paying the income tax. host: tom, go ahead. caller: hello. i like to ask a question as far as the obama health care takes affect. will the benefits if an employer pays your insurance be considered in come and taxed accordingly? that's my question. thank you. guest: as of right now, it would still be protected from taxation. that is something on the line as part of tax reform. with aaron,talking

good morning. caller: looking at tax credits on this thing and one non be looking at reducing some of the extraneous taxes that are out there and then we get a tax credit for them? host: can give an example? caller: no, because i have somebody prepare my taxes. they are not a big amount. we're being taxed and taxed again, if that makes any sense to you. guest: that proponent of the tax reform talks about their so much in the code that is extraneous and unnecessary. to hold down to something less unwieldy than will we have

today. host: mark on the independent line, hi. caller: i appreciate you taking my call. .'m 42 every time there is an election, therequartefour years, is a big squabble about the unfair taxation. many callers: and the fair thing would be everybody to pay an equal tax. nobody will be left felt that they are being taxed unfairly if everybody was paying the same. the port don't have to pay and the rich don't have to and bill class pays the bills -- the poor

don't have to pay. and we expect in the federal government to resolve everything? we're still squabbling about how to pay for medicare, medicaid, texas, illegal immigration. nothing in my generation's concerns have been resolved by the federal government. they cannot be found liable. what do we do as individuals? get out from under the federal government? guest: the call reflects a frustration that members of both parties have that congress keeps on ticking the can down the road and tax policy is perhaps the biggest example. we have this dec. routine every year where there is a meltdown over tax policy.

in 2010, but it was what to do with the bush tax cuts. this time last year we were talking about what to do with the payroll tax cuts. you have to wonder if we're headed toward a reckoning. you have to wonder whether we're heading to some type of big decision that would solve some of these problems for the long term. when we go through such year by year, month by month policy debates, it creates an incentive to sell these once and for all. host: vivian makes this point on twitter. the white house wants to make the tax code simpler. that has been floated in years past by other administrations.

guest: it is hard to do tax reform. biggest ticket items are the mortgage interest deduction, the protection of the employer- provided health care, things like that. it is hard to go after those in any political climate. there is so much talk about capping deduction. that is a way to do tax reform but not make these hard decisions. you're making it harder -- or reducing its value. host: the changing of the tax code. "the baby boomers are now in full retirement mode."

guest: it is import to think about 2012 or 2013 is from 1986. the 1986 tax code overhaul was paid for in part by raising taxes on corporations and investment income. it is hard to see that happening today. we saw that during the campaign. corporations are trying to lower their taxes. it is hard to replicate that kind of thing. there was more good will in 1986 with tax reform. we came off the social security deal in 1983.

there were some real bipartisan successes. it is hard to see a track record in this climate. caller: thank you. i keep hearing the number $250,000 as the cutoff for the wealthy, if you will. for those of us in middle class in the dc area, that is not wealthy. i heard senator kane in that number to $500,000 and i wonder about the possibility of that proposal being adopted? guest: that is something we will see it play out as these negotiations come to a head. people talk about the threshold as being too low.

$500,000 is something the democrats have supported in the house. we look at the threshold because that is where you get a lot of revenue. as you move the threshold for their up, you're getting less revenue. host: ellen on the republican line. caller: i have a different kind of question. the earned income tax credit is more beneficial for unmarried parents and for low-income, married, working parents. what does this do to traditional family values? guest: if you're married, you get less of a tax credit then you would if you're a single parent. there have been efforts to

effectstose kinds of the f ward.going for caller: good morning. you made a statement going over the cliff. if you went over the cliff and a turnaround and they reset the -- the lady from kentucky talk about how obama had raised her taxes. she has gone more tax breaks since obama was president -- she pays a lower rate than she did for the past 60 years. guest: in terms of the retroactive applica